We employed site-specific mutagenesis to generate a series of mutants of an HA-SV40 recombinant. These mutants contained point mutations in the region of the HA gene that encodes the signal peptide sequences. The mutant HA-SV40 recombinants were then used to transfect African green monkey kidney cells in order to achieve expression of mutant hemagglutinins. Characterization of mutant influenza virus HAs with altered signal peptide revealed that a majority of the mutations had no effect on functional properties of HA such as cell surface expression and erythrocyte binding. However, one mutant (designated mutant 28) that sustained multiple amino-acid substitutions produced HA that remained intracellular and was not expressed on the cell surface. Sequence comparison of this mutant and other mutants that were expressed normally on the cell surface suggested that amino acid substitution at the signal cleavage site was responsible for the observed functional abnormality. The defective intracellular HA contained an endoglycosidase H (endo H) sensitive carbohydrate component, whereas the endo H resistant sugar moiety normally present in the wild type HA was not detected. In addition, the molecular size of non-glycosylated mutant 28 HA was larger than non-glycosylated wild type HA as indicated by a slower migration rate on SDS-polyacrylamide gel. This finding is consistent with the sequence data indicating that the mutant HA was altered at the signal cleavage site. These results suggest that HA containing uncleaved hydrophobic signal sequences translocates across the microsomal membranes but fails to undergo further transport to the golgi apparatus where additional processing of carbohydrate components takes place.